Professional Documents
Culture Documents
Managerial Accounting
Managerial Accounting
Perdizo, Miljane P.
1. A SEGMENT IS A PART OR ACTIVITY OF AN ORGANIZATION
ABOUT WHICH MANAGERS WOULD LIKE COST, REVENUE, OR
PROFIT DATA. EXAMPLES OF SEGMENTS INCLUDE SALES
TERRITORIES, INDIVIDUAL STORES, AND SERVICE CENTERS.
There are two keys to building segmented
income statements.
1. A contribution format should be used.
2. Traceable fixed costs should be
separated from common fixed costs to
enable the calculation of a segment margin.
Example:
1. Assume that Webber, Inc. has two
divisions: the Computer Division and the
Television Division
Income Statement
Income Statement
Income Statement